What is a counterclaim, and what happens if my client makes one?
The short answer
A claim against you. A counterclaim is your client's own claim for money1, filed with their defence and heard alongside yours, and it can be for more than you are owed. You have 14 days after it is served2 to file a defence to it. Miss that and the client can ask for judgment on it, as you could against them4, and there is no acknowledgment of service to buy you more time.
England and Wales only. WolfX is software, not a law firm.
The numbers
The numbers once a counterclaim lands.
What you can add
A £4,800 invoice and a £2,100 counterclaim
Say a design studio sent another business an invoice for £4,800, payable by Friday 10 July 2026. It was unpaid, the day-30 letter before action was ignored, and the studio started a court claim on Monday 7 September 2026: 59 days late. Interest uses 11.75%11, 8% over the Bank Rate of 3.75%, for invoices that went late in the second half of 2026. The £205 court fee8 is already paid. By the end of September the client has filed a defence and a counterclaim for £2,100, and paid a £115 fee8 on it. The studio's hearing fee is £346.
- The invoice£4,800.00
- Interest: £4,800 × 11.75% ÷ 365 × 59 days10£91.17
- Fixed sum (invoices from £1,000 to £9,999.99)12£70.00
- Less the part of the counterclaim the court allows (say £1,300)−£1,300.00
- Left on your claim£3,661.17
If the court allowed all £2,100, you would be left with £2,861.17. Interest on your claim keeps growing by £1.55 a day while the case runs.
The road ahead
Six steps. One hearing fee.
Step 1: Read the papers for the date
Step 3: Split it into arguable and not
Go through each item the client claims. Mark what is plainly arguable, such as work that really was late or faulty, and what is not. A part-admission can end the argument, and the rules on admissions apply to a counterclaim1.
Step 4: File your defence to the counterclaim
Say in writing what you accept, what you deny and why, and file it before the 14 days end. If the client agrees in writing, you can extend by up to 28 days2 and must tell the court in writing. Your own claim carries on as in what happens after a defence.
Step 5: Take the free mediation call
Claims of £10,000 or less usually go to a free mediation call before any hearing, and you must attend: skipping it can get your claim struck out9. It is the quickest place to net the two sums off. Read what mediation is first.
Step 6: No deal? Pay the hearing fee by the order's date
No deal means a hearing. On a claim over £3,000 you pay its £346 fee8 by the order's date, or your claim is struck out. Don't withdraw in alarm: the counterclaim can carry on alone, and its hearing fee is then the client's.
Settle before the fee is due and you need not pay it8. If the client wins on the counterclaim in a small claim, the court can order you to pay their court fees7.
The letter
The reply to a counterclaim is a defence filed with the court, not a letter to the client, so there is nothing here to copy and send.
When not to bother
When it isn't worth it
- The counterclaim is close to your claim in size. File your defence to it anyway, and the mediation call can then net the two sums off, so one payment ends it for both sides.
- It is backed by paperwork and is bigger than your claim. Settle, or take advice from a solicitor who does commercial disputes before you file anything.
- The company has no money. A win on paper may not be paid, but dropping your claim leaves theirs alive, so still defend it and read whether it is worth suing a company that has no money.
- It is a Scottish or Northern Irish case. These rules are for England and Wales, and the court routes there differ.
The Wolf's note
A counterclaim is a second claim in the same case, with its own clock. Read the date before the amount. Then split it into the part you can argue with and the part you cannot, and answer each on its own.
Mr. Wolf · the AI inside WolfX
What comes next
Your next move
If they still won't pay
What is small claims mediation, and do I have to try it?
Usually, yes. If your defended claim is for £10,000 or less, you must attend one free phone call with a court mediator.
5 min read
If they still won't pay
What happens at a small claims hearing, and how do I prepare?
Informal, often in the judge's room.
6 min read · Letter included
My client says the work wasn't good enough and won't pay. Can they do that?
Only for the part that is really wrong.
7 min read · Letter included
Don't want to do this yourself?
The Wolf does every step for you. He works out the sums, writes the letters and keeps track of every date. Nothing goes without your yes.